Mid-market private equity house LDC has completed a significant investment to support the GBP42 million management buy-out (MBO) of Eley Group from Birmingham-headquartered engineering business IMI plc.
Based in Sutton Coldfield, near Birmingham, Eley Group comprises two trading subsidiaries: Eley Limited (which includes Eley Americas Inc.) and Accles & Shelvoke.
Founded in 1828, Eley is a manufacturer of .22LR rounds for the target shooting market. Its products are used in target shooting by Olympic standard athletes at all major global tournaments.
The deal with LDC will provide further capital to help accelerate the continuing growth of Eley Group, primarily through new product ranges and further penetration of the global marketplace.
The Eley Group currently employs more than 120 people, and in 2014 is forecast to generate turnover of GBP17million and EBITDA of GBP6.1million.
LDC has backed Eley Group’s existing management team led by managing director Andrew Lane.
LDC’s chief executive officer, Martin Draper, says: “Eley Group comprises well-established market leading businesses that have unrivalled reputations in their own distinct sectors. Growth is being driven by consistent demand for high-quality target shooting rounds on a global scale, with the Eley product range firmly established as the number one choice in the international competitive shooting space.
“We are partnering with a high-quality management team led by Andrew Lane, and will be working closely with them to accelerate the next phase of growth and expansion both here in the UK and internationally.”
Lane says: “LDC’s investment reflects the confidence that both parties have in Eley Group’s future growth potential.
“Looking forward, LDC’s support will allow us to strengthen our market leading position, invest for future growth and accelerate expansion into new geographic territories. We will also continue to maintain a firm focus on the manufacture and supply of quality products for growing our customer base, both here in the UK and overseas.”
The deal was completed by LDC with support from a number of Midlands-based advisers including Wragge Lawrence Graham & Co, who acted as legal adviser to LDC, and PwC Corporate Finance who acted for the vendor.
The deal represents LDC’s 13th new investment of 2014, having invested over GBP200million of new funding, together with a further GBP15million of capital to support portfolio business acquisitions.
The transaction was completed using capital from LDC’s GBP500 million manufacturing and specialist engineering commitment that was launched in 2011. The initiative focuses on supporting businesses with specialist manufacturing capabilities across a range of niche sectors including power generation, aerospace, defence and oil and gas.
